Hearings were cheap, disgraceful: Duncan
The legislature's public accounts committee heard over and over again Wednesday how the Mayo-Dawson City power line grew into a financial monster, dragging everybody along with it.
The legislature's public accounts committee heard over and over again Wednesday how the Mayo-Dawson City power line grew into a financial monster, dragging everybody along with it.
Liberal Leader Pat Duncan spent a few minutes this morning describing the hearings chaired by official Opposition Leader Todd Hardy as disgracefully political and partisan, rather the objective and meaningful.
Yukon Energy president David Morrison told the committee it's apparent the boondoggle was caused by mismanagement, false expectations, lack of control over accountability and some in-house drive to get the project done quickly.
There is also no evidence the board of directors was told by the Crown corporation's senior management how far out of control the project was getting, Morrison told the committee.
He said there seemed to be an attitude within management of Yukon Energy that with signing authority for expenditures of up to $1 million, there was no need to inform the board of costs as they exceeded the revised $29-million budget.
'If management was going to exceed the $29 million, they should have brought a change order to the board and requested approval of that change order for an increase in the budget,' Morrison told the committee.
'For some reason there seemed to be an urgency,' said Morrison. 'I can't document it for you; I can't point my finger to it, other than it's apparent to me when you look at how decisions were made and when they were made there seemed to be an urgency to do this project. Somebody had an urgency. I don't see it at the board level; I can only see it at the management level. There was a push to do it.'
At the centre of the committee's questioning was the auditor general's report on the Mayo-Dawson line that went from an original budget of $27.2 million to $36.2, and perhaps significantly more.
The report says while senior management of Yukon Energy failed to keep the board of directors informed, the board failed in its responsibility to properly challenge and scrutinize the project, before and after construction began.
It pointed out, for instance, a review by B.C. Hydro International, a subsidiary of B.C. Hydro resulted in the recommendation to not proceed with the design-build contract method. Management never informed the board of the recommendation, and in fact recommended the design-build approach.
Chant Construction Ltd., the company hired to design and build the transmission line, has filed a claim for an additional $17 million related to the project. Yukon Energy has filed a claim against Chant for $9.5 million.
And while Morrison spent hours lamenting the failure of project management, and providing assurances it won't be allowed again, committee members kept coming or alluding to the issue of political accountability.
Either directly, or through innuendo, was the question of whether the Liberal minister of the day knew, or should have known, how the project was off the rails, almost from the get-go.
Several times, the question came up as to whether the minister requested or was provided a regular update on the project.
Duncan came out swinging this morning in a terse interview with the Star that suggested the Yukon Party and NDP committee members used the hearings for political gain, rather than for the public good.
The public accounts committee is supposed to find out what's broken and recommend repair work, she said.
Instead, they chose to 'launch a political, partisan attack,' during Wednesday's questioning of Morrison and Willard Phelps, the recently-appointed chair of the Yukon Development and Energy corporations.
The former premier, a member of the committee, said she voluntarily withdrew her participation after seeking the advice of the committee chair who suggested she might be called as a witness, as it was under her government the project went ahead.
She said she could have answered many of the questions about whether there was evidence indicating the Liberal ministers responsible did or did not keep themselves abreast of the project as it went further and further off the rails.
Duncan said she was prevented from providing the committee with that input because Hardy did not call her to explain.
'It left the public with the impression that I had not done my job, or any of the ministers succeeding me, and that is not fair,' she said. 'You have to understand what arm's-length means, and what the role of the minister is.'
Duncan explained earlier this week she did fulfill her obligations to ensure the project had received the required scrutiny and was sound prior to giving project approval in August 2000.
And as issues arose, succeeding ministers Don Roberts and Scott Kent brought the matters forward, such as the issue of the contractor trespassing on first nation land, for which Yukon Energy was forced to pay compensation.
Crown corporations, she insisted, are supposed to work at arm's-length and ministers should not be allowed to micromanage.
And where her government found there was weakness in its control over the Crown corporations, they addressed in the new Liberal legislation, the Corporate Governance Act which was passed in the spring of 2002.
Asked if she or her government were ever told the project was in financial straits, Duncan simply responded, 'no.'
She said questions asked by Yukon Party MLAs Brad Cathers and Patrick Rouble, NDP MLA Steve Cardiff and the chair left the impression her government knew something was wrong and did nothing about it.
'That is not the case,' Duncan said. 'It was a cheap, partisan political attack that was left on the table, and I think that is not fair.'
The auditor's report is abundantly clear, she emphasized, that the management of Yukon Energy was not keeping its board of directors informed.
Phelps, the former leader of the Progressive Conservative Party, the Yukon Party's predecessor, told the committee that since the Yukon Party brought in Morrison to serve in the position Phelps holds now, the line of communication between the chair of the energy and development corporations has been wide open.
And as the recently-appointed chair, Phelps plans to keep it that way.
'I remember when I was a minister that one of the things that my deputy ministers would say or deputy ministers generally would say is that one of their most important tasks is to protect the minister,' Phelps said. 'As I've already said, I think, not matter who the minister is, that's the chair's responsibility.'
Phelps was responding to a question from Cardiff regarding an apparent breakdown in communications between Yukon Energy management and the board of directors, the board and the minister's office and the minister back to the board.
Phelps, who was briefly the government leader in 1985, also noted regular reporting to the minister is now required under the governance act.
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